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NORTH AMERICA AND GLOBAL ECONOMY
TRADE REPORT ON TURKEY
Funda Celikaksoy
Said Diarra
COUNTRY PROFILE
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The population is approximately 70 million in 2003
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The population growth rate is 1.53%
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The life expectancy is 68.7 years
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The age distribution is:
• 0-14 : 26.6%
• 15-64: 66.8%
• 65 +: 6.6%
COUNTRY PROFILE
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Politics:
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Turkey is a parliamentary democracy
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The President is Ahmet Necdet Sezer and the Prime Minister is
Recep Tayyip Erdogan
The President is elected by National Assembly for a seven year
term
The Minister of Economy is Ali Babacan and the Minister of
Industry and Trade is Ali Coskun
COUNTRY PROFILE
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Ethnic composition:
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Turks: 80%
Kurds: 20%
Religion:
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Muslim : 99%
Christian and Jews : 1%
COUNTRY PROFILE
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GDP IN $US:
1999
2000
2001
2002
2003
GDP in
$ US(per capita
PPP)
6,135
6,730
6,046
6,448
6,718
GDP
Real growth rate
(%)
- 6.1
6.3
-9.5
7.9
5.9
GNP current prices
(million $)
185,267
200,002
145,693 180,892
239,235
GNP per capita
2,879
2,965
2,123
3,383
2,598
COUNTRY PROFILE
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Structure of the economy:
GDP composition by sector
(%)
1999 2000
2001
2002
2003
2004
Agriculture
16.0
15.4
12.8
13.0
13.4
24.3
Industry/
Manufacturing
19.0
20.0
21.1
19.7
18.5
15.3
Services
64.9
64.6
66.1
67.3
68.2
61.0
COUNTRY PROFILE
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Government finances:
 The budget is constantly in deficit
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The public debt ratio to GDP is 54.4%
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The government expenditure is 39% of the GDP
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The government revenue is 28% of the GDP
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The public debt is 194,386,700 billion (TL) (194 billion $CAN)
COUNTRY PROFILE
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Balance of Payment:
(million dollars)
2001
2002
2003
2004
Current Account -9,819
3,390
-1,522
-8,037
-10,739
Goods balance
-21,959
-3,733
-7,283
-14,010
-18,772
Goods&service
-10,591
5,397
596
-3,505
-7,166
Goods&service& -14,593
investment
397
-3,958
-9,064
-11,658
Capital Account
9,584
-14,643 1,161
7,091
13,169
Balance
-2,997
-12,924 -212
4,097
4,587
Official Reserves
2,997
12,914
-4,097
4,584
2000
212
Country Profile
Exchange rates : on March 4 2005; YTL/USD 1.2620,
YTL/EURO1.6690, YTL/CAD 1.020
 Foreign Exchange Reserves: On Feb 18 2005 total
reserves is US$ 38,433.4 million, foreign currency
reserves are held mainly in US dollars
 Net international investment position by latest data in
2003 is US$ –111,225 million
 Gross External Debt: US$ 153,160 million
 Foreign Debt to GDP ratio: 64%
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COUNTRY PROFILE
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Global Ranking:
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Growth Competitiveness: 66th out of 80
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Business Competitiveness : 52nd out of 80
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Public Institutions: 63rd
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Corruption sub index: 75th
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Microeconomic Competitiveness: 54th out of 80
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Human development index: 88th
COUNTRY PROFILE
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International organizations:
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Trade Agreements:
NATO, Council of
Europe, UN, OECD, UNESCO, WHO, WTO, IMF, World Bank
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Customs Union with EU
EFTA
Euro-Mediterranean Partnership
Economic Cooperation Organization
Black Sea Economic Cooperation
COUNTRY PROFILE
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Bilateral relations with Canada:
Turkey is a valued commercial and strategic partner for Canada
They both share common membership in numerous
international organizations (UN, G20, OECD)
Turkey is Canada’s second largest trading partner in Central and
Eastern Europe
It provides good opportunity to sell Canadian products/services
The total bilateral trade is positive and is expected to steadily
increase
COUNTRY PROFILE
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Bilateral relations with Canada:
Canada’s primarily exports commodities (coal, wheat, wood
pulp)
Double taxation agreement was reached between the two
countries
Canada-Turkey framework agreement (to ensure closer bilateral
relationship)
Country Profile
Bilateral relations with the US
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US is one of the major trade partners of Turkey
Export items to the US: iron&steel, pearls and precious stones,
machinery and mechanic parts, tobacco and cement
Import items from the US: machinery, electrical equipments,
pharmaceuticals, organic chemicals, aircraft and parts, optical
and photographic instruments
Exports and imports share 8 and 5% respectively
Turkey constitutes 0.2% of imports and 0.4 of exports of the US
COUNTRY PROFILE
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Bilateral relation with NAFTA:
Turkey mostly deal with Canada and the US but doesn’t have a
significant relationship with Mexico
Turkey’s exports to NAFTA totaled more than $3.6 billion in 2004
(8.6% of total exports)
Turkey’s imports from NAFTA equaled more than $4.6 billion
(5.4% of total imports)
INTERNATIONAL TRADE
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Turkey’s exports:
Total exports are US$ 56 billion in 2004
Main exporting partners are Germany, the US, the UK, Italy,
France, Spain, Holland, Russian Federation ( 80% of exports are
directed to EU countries)
Main export products:
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Textile and clothing: $6.6 billion 23% of total exports
Iron and Steel: $2.2 billion, 6.9 million tons
Agriculture: Olive, cotton, tobacco, hazelnut
Chemicals: $436 million, plastic raw materials
$ 289.6 million, soaps, detergent, cleaning products
 Glass and Ceramics: 5th in tiles production (world)
4th in Europe
 Gold jewellery
 Mining
INTERNATIONAL TRADE
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Turkey’s imports:
Total imports are US$ 87 billion in 2004
Main importing partners are Germany, The US, the UK, France,
Russian Federation (88% of imports are from EU)
Main import products are:
 Machinery and equipment
 Chemicals
 Petroleum
 Pharmaceutical products
INTERNATIONAL TRADE
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Capital Flows:
Total FDI in Turkey amounted to US$ 32 billion by 2003, there
are 6584 foreign companies operating in Turkey, 108 out of top
500 companies list of Fortune magazine
The leading investors: France, Netherlands, Germany, UK, the
US
EU accounts for 68% of foreign investment stock
OECD accounts for 88%, 2% for Islamic countries, 1% East
European countries, 9% other countries
Services represent 50-55% of the total stock of FDI
Manufacturing sectors investments, 35-40%
Agriculture and mining investments: 5%
INTERNATIONAL TRADE
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International disputes:
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Turkey has been involved in 12 cases
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7 concerned Turkey’s trade measures
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3 involved quantitative restrictions on imports of textile and
clothing products
Turkey has been the complainant in 2 cases against Egypt and
South Africa
INTERNATIONAL TRADE
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International disputes with the US:
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Generalized System of Preferences (GSP)
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Intellectual Property Rights
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Anti-Dumping & countervailing duties
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Textiles trade
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FDA regulations
TRADE POLICY
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Influenced by WTO and trade relations with the EU
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An export-oriented high value-added services and manufactured
products
It also includes an emphasis on technology-intensive
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Focuses on supporting export activities particularly of SME’s
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Government's goal is to contribute to efficiency of free zones by
dealing more with Middle East, Caucasian region and Central
Asia
TRADE POLICY
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Long term strategy contains 8 five year
development plans for 2001-2005
Reduce state intervention by privatization of
public enterprises
Promoting FDI
Continue industrialization policy
Finance exports through the Turk Eximbank
Improve infrastructure for better international
trade relationships
TRADE POLICY
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Recent modifications on domestic legislation on:
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Intellectual property rights
Telecommunication
Customs
Anti-dumping
Banking
Energy
Government procurement
TRADE POLICY
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It is not a signatory of the Plurilateral
Agreements from the Uruguay Round
Interest in Doha Development Agenda:
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Future multilateral tariff reduction
Simplification of tariff structure
Elimination of non-tariff barrier
Equitable agricultural trading environment
CONCLUSION
Many future opportunities with the future and official entry in the
EU
Acquiring more knowledge with the machine they’re importing
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Multiple agreement in the region give them an increase level of
trade because they deal with different type of market influence
in “relationship know-how”
Stable political regime so less risk for making business
Average ranking that gives it time to grow